The EU Referendum: 

Implications for Real Estate

EU Referendum
The EU Referendum

29 March 2016, by Savills Research

Short-term economic uncertainty will impact on all three sectors

■ The political battle lines have now been drawn ahead of the EU referendum on 23 June and there is much speculation as to what this may mean for UK and European real estate.

■ The polarised opinions being touted by the opposing campaigns – which are accompanied by claims and counter claims of scaremongering – do little to lift the fog. We have, however, endeavoured to provide a general overview of the possible impact of a Brexit on the commercial, rural and residential markets.

 

■ Generally, we believe that the medium-term implications of the result of the referendum are relatively unimportant for real estate. The fundamental attractions of all three asset classes have more to do with the assets themselves than whether they sit within or outside the EU.

■ However, we do believe that short-term economic uncertainty could impact on transaction volumes across all three sectors.

■ A vote to stay in the EU would result in restored demand, though the extent of a ‘relief rush’ would vary from sector to sector. In the event of a vote to leave, such uncertainty would be extended to the period during which the UK renegotiates its relationship with the EU and other major trading partners.

■ The biggest direct risk is the potential long-term reduction in subsidies in the agricultural sector. In the commercial markets we do not feel that there is a substantial risk of companies relocating from London in significant numbers. While short-term risks in the residential sector are greatest in those markets where international buyers are most active, we believe the impact on the wider UK market remains largely dependent on domestic factors.

Articles from The EU Referendum – March 2016

The Implications For Commercial Real Estate

We do not feel that there is a substantial risk of companies relocating from London in significant numbers

The Implications For Rural Real Estate

We expect average farmland values to come under pressure in the short term

The Implications For Residential Real Estate

We believe the impact on the wider UK market remains largely dependent on domestic factors

 
 

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Key contacts

Ian Bailey

Ian Bailey

Director
Rural Research

Savills Margaret Street

+44 (0) 207 299 3099

 

Lucian Cook

Lucian Cook

Director
Residential Research

Savills Margaret Street

+44 (0) 20 7016 3837

 

Mat Oakley

Mat Oakley

Director
Commercial Research

Savills Margaret Street

+44 (0) 20 7409 8781